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For many businesses, it can be tricky enough just trying to correctly classify workers as exempt or nonexempt. Once you know which of your workers are exempt and which are nonexempt, knowing when to pay them overtime is another “can of worms.” The equation is only made messier by employee travel and overtime pay.
In this article, I’ll break down what small businesses and start-ups should know about many of the most common overtime travel circumstances. While we discuss federal requirements and guidelines in this article, it’s important to remember that different states may have slightly different (more employee-favorable) requirements for employee travel overtime pay—and you should always be sure to check through those with an experienced certified professional employer organization (PEO) before proceeding.
When it comes to properly paying FLSA nonexempt workers, Axcet HR Solutions can help you determine when overtime must be paid versus when it doesn’t need to be. Let’s dive in!
This is the most common travel situation, so we’ll cover it first! If an employee is reporting to their shift for work at their regular location, they do not need to be paid overtime for travel. Under federal regulation 29 CFR § 785.35, companies are not required to pay employees for any time that they spend commuting from their homes to their job site before their working day starts, or commuting from their job site to their homes after their working day ends.
If they are actually working overtime, they should be paid overtime—but that clock stops running as soon as they head home from work.
When an employee is traveling from their main job site (whether their home base job site or not) to another job site, and the travel occurs during one working day, the employee is paid as normal. Hours worked outside of 40 (including those spent in job site to job site travel) count as normal overtime working hours.
This means that if a nonexempt employee has worked 41 hours in a given week (including when traveling between job sites), they must be paid overtime for all hours worked in excess of 40. The federal government’s Portal-to-Portal Act covers this scenario. For example, a worker has multiple assignments in a day or has to travel between job sites to get tools, pick up other workers or similar.
RELATED: Employee Travel and Sleep Time FLSA Pay Rules >>
Any type of travel that keeps an employee away from home overnight constitutes “travel away from home.” This scenario is the trickiest to understand because it can be a bit unintuitive.
Let’s frame this by thinking about the employee’s typical workday. In this example, we’ll consider the employee’s typical workday hours to be 9 a.m. to 5 p.m., but for your employee calculation, you should adjust using their standard hours.
Travel away from home constitutes working hours that need to be calculated for overtime purposes when the travel cuts across the employee's typical workday (in our example, from 9 a.m. to 5 p.m.). During this travel, the employee is “substituting” travel time for the work they would be doing during their normal hours.
Note that even during this type of travel, regular meal time (in periods of thirty minutes or more) is not counted toward working hours for overtime calculation purposes.
RELATED: Understanding Business Travel Time Pay for Non-Exempt Employees >>
Here’s where it gets interesting: Even if the example employee only typically works 9 a.m. to 5 p.m. on weekdays (i.e., Monday through Friday), if they travel on a weekend day, their standard hours still apply to the overtime calculation. Let’s say our nonexempt example employee lives in Kansas City, Missouri, and travels to Phoenix, Arizona for an overnight assignment. If the employee’s flight into Phoenix leaves on a Sunday at 1 p.m. and arrives in Phoenix at 6 p.m., they should be instructed to log only the hours between 1 to 5 p.m. as working hours for overtime purposes.
This is because those standard working hours (9 a.m. to 5 p.m.) still apply to the calculation, even though the work is done on a weekend day. If the returning flight to Kansas City leaves from Phoenix at 7 p.m. and arrives in Kansas City at 12 a.m. the next day, they would not log any overtime (since these hours are outside of their working hours).
Nonexempt employee travel overtime calculations can feel overwhelming for even the most experienced manager or business owner. From HR compliance to payroll administration and beyond, Axcet HR Solutions understands the world of small business human resources and knows how to help.
Working with a PEO can help ensure your employees are paid correctly every time, and that those payments are issued in compliance with all applicable laws and regulations. Wondering if outsourcing human resources is the right call for you? Reach out to our consultants today to learn more.
Written by
Jennifer Bevitt, CPP is a Senior Payroll Administrator at Axcet HR Solutions, where she works closely with clients to deliver accurate, compliant, and efficient payroll processing. With more than 15 years of experience at Axcet, Jennifer brings extensive knowledge of payroll operations along with a strong commitment to client service and accuracy.
In her role, Jennifer manages end-to-end payroll processing for her clients, ensuring all data is reviewed, verified, and executed correctly. She serves as a trusted resource for both employers and employees, answering questions related to payroll, taxes, deductions, and compliance while helping resolve issues quickly and effectively. Her expertise helps clients navigate complex payroll requirements with confidence.
Jennifer holds the Certified Payroll Professional (CPP) designation, a nationally recognized credential that demonstrates advanced expertise in payroll processing, tax regulations, compliance, and payroll systems. This certification reflects her deep understanding of federal and state payroll laws and her ability to apply best practices to ensure accuracy and regulatory compliance in every payroll cycle.
Jennifer is also actively involved in onboarding new clients, conducting payroll training, and supporting ongoing client relationships. She assists with benefits administration, paid time off tracking, and maintaining accurate employee records across payroll systems. Known for her reliability, responsiveness, and attention to detail, Jennifer takes pride in delivering a high level of service and building long-term relationships with the clients she supports. Through her writing, Jennifer shares practical insights and best practices to help employers better understand payroll processes, maintain compliance, and run their businesses more efficiently.
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